The Pew Charitable Trusts - State and Consumer Initiatives about

Governors Fear Loss of Bond Tax Exemption

A panel of top tax policy analysts has warned the nation’s governors they face an ongoing risk of increased borrowing costs if President Obama and Congress curb or eliminate the tax exemption on municipal bonds to bring down the federal budget deficit.

Debt Ceilings Without Drama

Most states have rules that limit how much they can borrow. Unlike Congress, however, state lawmakers have almost never used the limits to engage in high-stakes political confrontations – at least not yet.

Illinois Passes on Pensions, Boots Lawmaker

The Illinois Legislature emerged from a special session Friday with one less lawmaker and no plan to address the state’s soaring pension obligations.

Illinois Lurches Forward, One Budget Crisis at a Time

Illinois faces a series of budget problems, including its latest crisis on pensions. But the drumbeat of bad news makes it easy to miss the big steps the state has already taken.

Are States’ Unemployment Insurance Loans Dragging Down Economies?

Most states are still paying off those unemployment benefits that went out to millions of those without work during the recession, but it’s the way some are doing it that raises concern.

Rhode Island Faces an Investment Gone Awry

After an investment many questioned from the beginning, Curt Schilling’s 38 Studios bankruptcy has left Rhode Island with a significant debt to pay, and facing questions over the future of economic development efforts.

Infographic: S&P State Credit Ratings, 2001–2012

Private, independent credit rating agencies evaluate states’ financial health. States with the lowest grades typically have trouble keeping their spending in line with their tax revenues.

Will States' Credit Suffer From S&P Federal Downgrade?

TODAY'S TAKE: Politicians and financial analysts are preparing for the ripple effects of a first-ever downgrade of the federal government's credit rating, including what it might mean for states.

The Debt Ceiling Debate

This brief examines how a potential default by the federal government could present serious challenges to states and cities.

Do States Control Their Fiscal Destiny? Not as Much as They May Think.

State leaders love to make promises about healing a sick economy. Often, though, economic success depends on factors far beyond their influence.

GOP Governors Are Key for Obama Debt Plan

TODAY'S TAKE: Republicans on Capitol Hill are skeptical about an Obama administration plan to help struggling states by shoring up their debt-ridden unemployment systems. Attention now turns to GOP governors.

How a Small Town's Bond Bust Led to a Model State Debt Policy

Lewisburg, Tennessee, got tangled up in an interest rate swap deal gone bad. As the town of 11,000 wrestles with the fiscal fallout, the state comptroller is forcing local governments to think hard before they engage in exotic investment deals.

Future of Popular Build America Bonds Program in Doubt

The Obama administration helped financially distressed state and local governments by subsidizing a borrowing program for infrastructure projects. The program is scheduled to end Dec. 31, although the lame duck Congress may extend it.

Despite Debt Fears, Voters OK Most State Bond Measures

Where borrowing was on the ballot Tuesday, voters usually said yes. Meanwhile, Colorado affirmed its ability to issue debt.

Painful Choices for Incoming Crop of State Leaders

A new report shows that voters are willing to make some sacrifices to avoid fiscal disaster. What they don't realize is how big those sacrifices might have to be.

Facing Facts

An analysis of public attitudes toward fiscal problems in five diverse states—Arizona, California, Florida, Illinois and New York—shows residents have strikingly similar priorities for state government, but their preferences clash with fiscal reality.

Public Broadcasting Cuts at Issue in Virginia

TODAY'S TAKE: A proposal by Virginia's governor to phase out state funding for public broadcasting ran into trouble in the state House of Delegates on Wednesday (April 21), as legislators sought to defend what they see as a valuable educational tool, particularly for children. Public programming has been a little-discussed victim of budget cuts in states from New York to Utah.

Summary of the New Jersey State of the State Address

Outgoing New Jersey Gov. Jon Corzine (D) told the Democratic-controlled Legislature Jan. 13 that he was disappointed he was not re-elected last November to serve a second term and that he hadn't done more to reduce property taxes.

Budget Insiders See Worse Ahead in Calif., Mich.

Two of the states hit hardest by the Great Recession-California and Michigan-are bracing for an even tougher time making ends meet next year, putting big spending cuts or outright elimination of some services on the table, top budget officials from both states said Friday (Nov. 13).

Budget 'Fixes' Run into Trouble

TODAY'S TAKE: Unlike the federal government, almost every state is required by law to balance its budget. But that doesn't mean state lawmakers always balance the books in the most straightforward of ways: by matching revenues with spending.

Weekly Wrap: Rating Agency Slams Conn. on Borrowing

Agency lowers Conn. credit outlook; federal broadband grants will be delayed a month; and confusion continues on stimulus job claims.

Weekly Wrap: California Faces July 1 Deadline

California Gov. Arnold Schwarzenegger (R) vows to let government operations come to a "grinding halt" if state lawmakers don't plug a $24 billion budget gap by July 1. As Detroit automakers GM and Chrysler deal with bankruptcy, Michigan announces the six dates that state government offices will close this summer to save money. For a quick update on the top recession news in the states, read Stateline.org's "Weekly wrap."

Despite Stimulus, Schools Feel Budget Pain

The economic stimulus will help public schools and colleges survive the recession over the next two years. But in some states the fiscal situation is so precarious that schools are still going to suffer large cuts.

California's agony can't be ignored

Everyone knows public finances in California, America's once-fabled Golden State of opportunity, are in shambles. But should the rest of us care? The state's ever-rising deficit has hit $24.3 billion as the legislature's liberal Democrats and conservative Republicans remain in constant deadlock. Voters in May overwhelmingly rejected five "budget reform" ballot measures.

The Path to California's Fiscal Crisis

California has always been a trendsetter. What happens in California often pops up elsewhere. Which raises this question: Are the perpetual billion-dollar deficits that haunt California state government unique to the Golden State or the harbinger of what other states can expect?

States Help More Workers Get Health Care

The stimulus package threw a lifeline to millions of newly unemployed workers by helping them pay for extended health care through the pricey federal COBRA law. But those laid off from small businesses get the help only if state law allows it.

Tracking the Recession: Credit Crunch Eases Slightly

It's still hard for states to borrow money, but Georgia shows it's not impossible.

Opinion: New Infrastructure Spending Demands New Thinking, Oversight

Congress and the Obama administration should find a new and better way to distribute billions of economic-stimulus dollars for infrastructure projects, John Rennie Short, who studies urban and environmental issues as a professor at the University of Maryland, Baltimore County, writes in a commentary for Stateline.org.

Wall St. Ills Worsen State Fiscal Headaches

(Updated 4:30 p.m. EDT, Sept. 19, 2008)The turmoil on Wall Street is setting off warning bells in state capitols. The immediate casualty is the loss of millions of dollars in the value of states' pension funds and other investments, but a bigger fear of state officials is a prolonged financial crisis that further reduces already shrinking tax revenue.

Cash-Strapped N.J.: Pay up for State Police

Facing tough times financially, New Jersey recently started billing some of its smallest communities for a service they have enjoyed free for nearly 90 years: regular state police patrols that help towns without local police respond to crime, car accidents and other emergencies. Pennsylvania is considering doing the same.

Coaches earn way more than governors

Every state but one pays its college football or basketball coach more than it pays its governor. Arkansas lawmakers defend their right to chew tobacco in the Statehouse. And Florida's state employees type in hundreds of online Wikipedia updates. In case you missed those stories this week, "Worth Noting" fills you in.

State finances expected to dip

Most states are sitting on comfortable budget cushions, but falling home sales, higher energy prices and skimpier sales tax collections could bust some state budgets this year.

Illinois gov runs up travel tab

Illinois Gov. Rod Blagojevich's commuting costs start to add up. South Dakota Gov. Mike Rounds settles a dispute with the U.S. Fish and Wildlife Service over a cranky game warden. California corrections officials install "flushometers" to control wasteful toilet flushing in prisons. In case you missed any of those stories this week, "Worth Noting" fills you in.

GAO Critical of Last Year's $10 Billion Bailout for States

Congress may want to think twice about signaling to states that Uncle Sam will rescue them each time a recession hits, the General Accounting Office, a congressional watchdog organization, suggested in a new report. Routine bailouts hardly give states an incentive to sock money away for tough times, the GAO said, amid other criticisms of last year's $10 billion federal bailout of states.

Report: States Spend Less; More Cuts in the Offing

State spending declined this year to the lowest level in nearly 15 years, according to a new report from the Center on Budget and Policy Priorities.

Job Creation Vexes States in a Weak Economy

State government--not private industry--was the biggest creator of new jobs in the country last month, a development that could explain why states are putting so much energy into keeping and growing new businesses within their borders. With jobs of utmost concern this election year, states are trying an array of strategies: from banning outsourcing of state-contract jobs to incubating high-tech startup companies.

Alaskans Split on How to Get State Out of the Red

Alaska is bitterly divided on whether to use a portion of its oil wealth its $28 billion permanent fund to get itself out of budget trouble. While the state faces a projected $500 million budget deficit in the next fiscal year, proposals to tap the fund to plug the gap face fierce resistance. Even a high-profile assembly of citizens has failed to forge consensus.

Governors to Press Their Issues with Federal Officials

This year's National Governors Association meeting in Washington, D.C., will have extra star power with the premier appearance of California Gov. Arnold Schwarzenegger (R). But the real focus will be on the tried-and-true issues of more federal money and less federal intrusion.

Let the Meager Times Roll; Half of States Face Shortfalls

State budgets are off the critical list, but dont put away the respirators just yet. The fiscal health of many states is still weak and in some cases anemic.

More Red Ink Forecast for States in Coming Year

A new report from the Center on Budget and Policy Priorities in Washington, D.C., forecasts a a fourth straight year of program cuts, tax and fee increases, and other budget-balancing maneuvers in the states.

Senate, House Tax Bills Differ on State Aid

The states' quest for fiscal aid took a step forward Thursday when the Senate Finance Committee, under pressure from moderate Republicans, voted to include $20 billion for state governments as part of President Bush's tax cut plan.

Who's to Blame for the Budget Crisis?

Is overspending during the "go-go `90s" a primary cause of the state budget crunch? The question is a political Rorschach test, and how you respond could reveal your political leanings.

States Caught in Fiscal Storm, NCSL Says

An historic budget crisis in the states is getting worse by the day and shows no signs of letting up anytime soon, according to a report released Tuesday by the National Conference of State Legislatures.

North Carolina Sees Credit Rating Drop

A top investment risk analysis firm downgraded North Carolina's credit rating Monday (8/19), underscoring how a sputtering economy, declining taxes and burgeoning deficits are creating costly fiscal headaches for states.